Under the 10-year deal, search results on Yahoo.com will say "powered by Bing," and Yahoo will fetch advertisers. Microsoft will pay the search portal 88 per cent of the revenue generated from searches on Yahoo's sites. Microsoft will also have the rights to combine Yahoo's search technology into its search.

The companies will implement the partnership by the end of 2010 in the US and globally by the end of 2012. Rival search company Google controls over 65 per cent of the market, according to online data tracker comScore.

Microsoft's Bing and Yahoo control nearly 30 per cent of the market combined, which analysts say will help the companies attract better advertising partners and help them fight competition from Google.